Teaching decision-making skills

May 18 2007

People who do well on a series of decision-making tasks involving hypothetical situations tend to have more positive decision outcomes in their lives, according to a study by decision scientists at Carnegie Mellon University and the RAND Corp.

The results suggest that it may be possible to improve the quality of people's lives by teaching them better decision-making skills. The study is being published in the May issue of the Journal of Personality and Social Psychology, and will be presented May 25 at the Association for Psychological Science's annual convention in Washington, D.C.

The paper marks an important step forward for decision science, because it shows that tasks developed to study decision-making errors in psychological labs can be used to gauge decision-making ability in real life. The study also shows that, although decision-making competence is correlated with verbal and nonverbal intelligence, it is still a separate skill.

"Intelligence doesn't explain everything. Our results suggest that people with good decision-making skills obtain better real-life outcomes, even after controlling for cognitive ability, socio-economic status and other factors," said W'ndi Bruine de Bruin, a researcher in the Department of Social and Decision Sciences at Carnegie Mellon and the lead author of the study."That is good news, because decision-making skills may be taught."

The study recruited 360 people with diverse backgrounds. Each completed seven tasks measuring ,Adult Decision-Making Competence," or their ability to avoid common decision-making errors. For example, a good decision-maker should be able to make choices independent of how information is presented, or framed. Imagine that you are learning about a type of medication that is 99 percent effective, for instance. You should be equally likely to use it if it is described as 1 percent ineffective.

Study participants also completed a survey with questions about controllable life experiences that might reflect poor decision-making. They were asked, among other things, whether they had ever spent a night in jail; been unfaithful to a romantic partner; bounced a check; been arrested for driving under the influence; had a romantic relationship that lasted for more than a year; and been diagnosed with Type 2 diabetes. As it turned out, those who reported the greatest number of negative controllable life experiences fared the worst on the decision-making tasks.

The authors cautioned that this study does not definitively prove that good decision-making skills lead to better life outcomes. The direction of causality has not yet been examined. It could be that the stress of difficult life experiences erodes decision-making skills. Further research could examine whether a person's life experiences improve after they have received decision-making training.